As an HR professional or team manager, you’re no stranger to the hot-button topics that often come up in conversations with new hires: compensation, work hours, employee benefits, vacation and time off, career advancement, and workplace culture. But have you ever noticed how frequently the conversation zeroes in on time off? It’s almost like a magnet drawing new hires in!
It’s not surprising. Employee leave can be a maze of policies and regulations, and understanding it all is crucial for keeping your team happy and productive. New hires are especially keen to understand their vacation options, paid leave, and the ins and outs of unpaid leave. They want to know what kind of PTO policy examples your company offers and how leaves like sick leave, bereavement leave, and parental leave fit into the picture.
Unpacking the details of paid time off (PTO) versus unpaid leave is just the beginning. Employees are eager to learn how to apply for unpaid leave, the specifics of FMLA leave, and the differences in FMLA rules from state to state—think FMLA Washington versus FMLA California. You can have individual state details here.
Clear, engaging explanations about these leaves and their policies help employees feel more secure and foster a supportive and transparent work environment. Whether it’s detailing how unpaid leave impacts benefits, managing time off requests, or clarifying policies on unlimited PTO, addressing these topics with clarity and enthusiasm makes all the difference. And don’t forget—balancing vacation time vs sick leave and understanding leave of absence policies can turn confusion into confidence, setting the stage for a positive start.
Let’s dive deeper into all that you need to know about the different types of paid and unpaid leave and time off your employees can avail themselves of.
What are Paid Leave and Unpaid Leave?
Unpaid leave refers to time off from work when an employee doesn’t receive their regular pay. This type of leave is typically used for personal emergencies, extended medical conditions beyond sick leave, or lengthy vacations. In contrast, paid leave allows employees to take time off work while still receiving their regular pay. This includes vacation time, sick leave, and other forms of leave that employers may provide.
States in the US that have a Mandatory Paid Leave Policy
States that require employers to provide paid leave are on the rise. Across the United States, including many cities, there is an increasing trend toward mandating paid time off. While the specifics vary by state, places like California, Connecticut, and New York are at the forefront of this movement. Right now, 13 states have a comprehensive, mandatory state paid family leave systems. On the other hand in New York, the paid leave system is based on mandatory private insurance system.
What are the Types of Paid Leave/Paid Time Off?
Paid Leave Examples are:
Sabbaticals
Traditionally seen in academia, sabbaticals are becoming more common in the private sector. These extended paid time off periods allow employees to pursue personal projects, further education, or conduct research. The specifics of a sabbatical, including its length and availability, are determined by company policy.
Parental Leave
This includes maternity and parental leave, offering new parents paid time off. Companies like Netflix and Amazon are leading the charge, and many states and cities are now mandating paid parental leave.
Paid Time Off (PTO)
Many businesses combine vacation time and sick leave into a unified PTO system. When taking sick leave, employees may need to provide a note from the doctor, based on company policy. This technique simplifies the management of time off by consolidating different types of leave.
Vacation
This can include unlimited vacation or regulated types. Employees might accrue vacation time over the year or gain immediate access to it once it’s earned.
Sick Leave
Reserved for illness or caring for a sick family member, sick leave is generally accrued monthly or per pay period. This type of leave helps employees recover without impacting their regular income.
Bereavement Leave
Also known as funeral leave, this provides paid time off for employees coping with the death of a close family member, allowing them to grieve and handle personal affairs.
Military Leave (Paid)
Under the Uniformed Services Employment and Reemployment Rights Act (USERRA), employees are entitled to paid military leave if their military compensation falls short of their regular earnings from their employer. This law applies universally, regardless of the employer’s size.
Leave of Absence (Paid)
Some companies offer paid leave of absence for situations not covered by disability insurance. For instance, a previous employer I worked with allowed up to 12 weeks of paid leave of absence before employees needed to switch to FMLA leave.
Holiday Pay
This refers to compensation received for working during recognized holidays like Christmas and Thanksgiving. Employees should review their company’s policy to understand the specifics of holiday pay and any differences in treatment between full-time and part-time staff.
What are the Types of Unpaid Leave/Unpaid Time Off?
Unpaid leave examples are:
Furlough
This is a temporary situation where employees are not actively working but continue to receive benefits. Initially common in government roles, furloughs became more widespread during the COVID-19 pandemic as an alternative to layoffs.
Unpaid Personal Time Off
This includes reducing working hours or taking a full unpaid day off. This type of leave might be used for intermittent FMLA, personal reasons, or other personal needs, with no pay provided during the absence.
Parental Leave
For most employees outside California, New Jersey, or Rhode Island, or those without a paid parental leave policy, unpaid parental leave is often required. New mothers should check their eligibility for disability insurance, which may offer partial pay during their leave. Before talking to the HR manager, they need to review their benefits.
Medical Leave (Non-FMLA)
If employees do not qualify for FMLA or if their employer is not required to offer it, they may still be entitled to medical leave according to company-specific policies. Check your company handbook for details on available medical leave and procedures.
Medical Leave (FMLA)
Employees working for eligible employers can take up to 12 weeks of unpaid medical leave under FMLA for personal health issues, caring for a family member, or military-related matters. To qualify, employees must have worked for 12 months and logged 2,040 hours during that period. For additional information, refer to your company handbook or relevant resources.
Leave of Absence
After exhausting their paid time off and vacation hours, employees can take an unpaid leave of absence. Companies offering this leave may follow different regulations and are not always required to adhere to FMLA rules.
Military Leave
Employees in the National Guard who are called to active duty are entitled to maintain their job while serving. Employers should be familiar with USERRA requirements, which apply to all employers regardless of their size.
Some Less Common Paid and Unpaid Leave Options
Time Off for Voting
Although not mandated by federal law, many states provide employees with time off to vote. According to surveys, around 50 percent of U.S. employers offer paid voting time to ensure employees can exercise their right to vote without financial strain. This policy helps employees participate in elections without impacting their earnings.
Jury Duty Leave
Employees can receive either paid or unpaid time off for jury duty, depending on local regulations. While most employers are required to grant time off for jury service, some states mandate that employees use their accrued vacation time or paid time off. Certain states also prevent employers from deducting jury duty hours from paychecks and protect employees from adverse actions like harassment or termination while serving.
Exceptions to Jury Duty: In specific cases, employees may request to be excused from jury duty if their absence would severely affect the company’s operations or threaten its viability. Such exemptions are typically considered when the employee’s role is essential and their absence would cause significant disruption to the business.
How Paid and Unpaid Leave Can Strengthen Team Unity
Did you know that how we handle paid and unpaid leave can greatly enhance our work relationships? One impactful approach is a shared leave policy, which allows employees to donate their sick leave and vacation time to a colleague facing significant challenges. This type of leave is now common in many countries like the UK. This is especially helpful for those dealing with severe health issues, complex childbirths, or other major family emergencies.
Such policies not only support individuals during their most difficult times but also foster a strong sense of community and teamwork. By participating in or supporting a shared leave program, you contribute to a culture of care and mutual respect. For more information on how shared leave can be implemented, check out resources like the UK’s Shared Parental Leave and Pay page.
In addition to fostering a healthy work culture, managing paid and unpaid leave effectively is crucial for HR professionals and employees. As companies grow, leveling up from spreadsheets to scalable leave software becomes increasingly beneficial (if not outright mandatory) for compliantly administrating a leave policy accurately and without creating huge overhead.
When making a choice for your organization, consider tools like AttendanceBot that both automate the approval and accrual of leave, while giving HR the flexibility to fully define their own leave offerings and rules across their workforce. Other AttendanceBot features like real-time attendance tracking and on-demand reporting help ensure that HR gets the visibility and data they need, while integration into popular digital workspace tools like Slack or Microsoft Teams makes it quick to roll out and popular among employees themselves.
We hope this blog gave you a comprehensive understanding of paid and unpaid leaves and time off.
